Whole Life Insurance Information
Having a life insurance plan may be more pressing than ever. According to the CDC, the average life expectancy is 78.7 years old.1 Having a plan in place can help protect your loved ones from the unforeseen difficulties that may arise if a main source of income is lost. A life insurance policy can help provide added protection. Whole life insurance is a popular choice.
whole life insurance information
There are many ways to go about choosing a plan, but the first step is deciding if whole life insurance is right for you. Whole life insurance can help ease the financial burden and allow your family to focus on healing. We encourage you to think about your dependents and how you can help provide peace of mind for your loved ones in the event of a loss.
Whole life insurance is a permanent life plan that provides coverage throughout your entire life. The premiums tend to cost more than a term plan would, but getting this insurance plan may be beneficial in the long run.
Your whole life insurance rates are determined by your age, medical history, and coverage goals. These factors allow us to create a plan that suits your needs best. Once decided, the premiums are fixed throughout your plan and the death benefit is certain. Some insurance companies allow you to make payments monthly, quarterly, or biannually.
Next, a portion of your premiums is usually put into an investment account to grow throughout the life of the plan. When the plan ends, the accrued cash value of the plan will be paid out to the beneficiary. If you name your beneficiary as an irrevocable life insurance trust, you may lower the tax liability. You can also broaden the number of beneficiaries on your policy.
At Aflac, you can get a better idea of what your plan will look like by getting a whole life insurance quote. This helps make the process easier and quicker. Our whole life insurance plans are also portable, so you can take them with you to every new venture.
Typically, mature buyers choose whole life insurance to expand their financial portfolio. On the other hand, young families usually opt for term life insurance to save money in advance. Term life insurance is also popular among seniors mapping out their future.
Now that we have explored whole life insurance pros and cons, are you interested in taking the next step? The cost of this permanent coverage varies depending on your unique history and lifestyle. Chat with an Aflac agent today to find your plan to help protect your loved ones.
Term life insurance provides coverage over a specified period of time. Typically, term insurance policies are written for 1, 5, 10, or 20 years, or to a specified age (such as 65). Term policies only pay a death benefit to the beneficiary if the policyholder dies during the specified term and so is a good choice when the policyholder needs protection for a temporary time or a specific need. Term insurance has the advantage of being more affordable than permanent insurance, particularly in the early policy durations. There are a few different types of term life insurance policies:
Universal life insurance is permanent life insurance combining term insurance with a cash account earning tax-deferred interest. Under most contracts, premiums and/or death benefits can fluctuate at policyholder discretion. The policy stays in effect as long as the cash value is sufficient to cover the cost of insurance and loans can be taken against the cash value of the policy.
There are also variable universal life insurance products which are kept in an insurer's separate account. The interest accrued under these contracts are not guaranteed and may in fact be negative since interest is a function of the change in the market value of the separate account assets.
Life insurance and annuities are regulated by state insurance commissioners. The NAIC encourages states to adopt model laws and regulations designed to inform and protect insurance consumers. The NAIC Life Insurance Disclosure Model Regulation (#580) requires insurers to deliver to purchasers of life insurance information that will improve the buyer's understanding of the policy and ability to select the most appropriate plan for the buyer's needs. The NAIC Life Insurance Illustrations Model Regulation (#582) provides rules for life insurance policy illustrations that will protect consumers and foster consumer education. The NAIC Consumer Credit Insurance Model Regulation (#370) protects the interests of debtors and the public by providing a system of rate, policy form, and operating standards for the transaction of credit life insurance.
The NAIC Life Actuarial (A) Task Force was formed to identify, investigate and develop solutions to actuarial problems in the life insurance industry. After adoption of the Standard Valuation Law (#820) by 46 states representing 87.5% of industry premium prior to July 1, 2016, the Standard Valuation Law became operative on January 1, 2017. The Valuation Manual is revised annually to add clarity to existing requirements and enact new requirements. The Task Force has adopted revised Generally Recognized Expense Table (GRET) factors for 2021.
Why get life insurance? First and foremost, to protect your family and those who depend on you for financial support. All life insurance will provide a payout to your beneficiaries if you pass away, but different kinds of policies can provide other benefits as well. The best way to start learning about your options is by seeing how easy it can be to get that protection.
This is permanent life insurance coverage that can provide guaranteed protection for the rest of your life while earning additional cash value that can be used for things like policy loans.8 Whole life policies don't expire as long as your regular premiums are paid. Policies from a mutual life insurance company (such as Guardian) may also provide dividends, helping you fund life's other financial opportunities.1,2,3
Like whole life insurance, this type of policy provides permanent protection and generates additional cash value. However, universal life insurance can give the added flexibility of adjusting your monthly payments within a specific range to help you better deal with changing work circumstances.4
When you get a quote, the rate is affected by many variables, including the life insurance company, policy type, coverage amount, length of term, gender, health status, and other factors. According to the Life Insurance Learn Center7, the monthly cost for $1,000,000 of coverage for the average male at age 30 is $48; at age 40, it's $73; at age 50, it's $177. Women tend to live longer and enjoy slightly lower rates, so $1,000,000 of coverage for a female age 30 is $37; at age 40, it's $53; at 50, it's $133.
Life insurance death benefits are almost always income-tax free. The cash value growth of a universal or whole life insurance policy is also tax-deferred, so it can grow faster because it's not being reduced by taxes each year.
The best policy for you depends on your needs and budget. If you're looking for life-long insurance protection that also provides cash value, there are two main options: whole life and universal life. A whole life policy offers level premiums and more guarantees, but a universal life policy can be more affordable because it offers variable premiums that you can raise or lower within a certain range. The insurance company may also let you customize your policy with various provisions, such as an accelerated death benefit rider to pay for end of life needs and even certain kinds of long term care. If you don't need permanent coverage or cash value, which can provide benefits such as policy loans, term life insurance quotes will generally be lower.
If you have loved ones who depend on you for income, life insurance is one of the best ways to help provide for their financial needs if you die unexpectedly. Life insurance companies also have specialized kinds of policies for customers with varying incomes and other needs, such high net-worth individuals looking to transfer assets more easily without incurring added estate taxes (you should always consult with a professional for tax advice first). On the other hand, if you have no financial dependents or heirs that you wish to provide for, then life insurance may not be worth getting.
3 Some whole life policies do not have cash values in the first two years of the policy and don't pay a dividend until the policy's third year. Talk to your financial representative and refer to your individual whole life policy illustration for more information
4 Universal Life Insurance may lapse prematurely due to inadequate funding (low or no premium), increase in cost of insurance rates as the insured grows older, and a low interest crediting rate. This does not apply to universal life policies which have a secondary guarantee, but if the secondary guarantee requirements are not met, the policy will most likely lapse.
We understand you want to give your child every advantage. The Grow-Up Plan is a simple, budget-minded way to start for children ages 14 days to 14 years. For as little as $1 a week, you can give your child a lifetime of life insurance protection with plans starting at $5,000. Your decision today will help your child be better equipped for adult responsibilities tomorrow.
Life insurance can be an essential part of financial and legacy planning. When shopping around for coverage, you may come across various products that fall into two main categories: term life and permanent life (also commonly referred to as whole life). Understanding the essential differences between these two main types of insurance can help you make coverage decisions according to your needs and goals.
Remember that insurance products for groups, policies that cover a group of people under a single contract (e.g., coverage offered through an employer), can differ from policies sold to individuals. The following information below focuses on products as typically sold to individuals. 041b061a72